Over 30 companies have put more than $560 million in bid money on the table at FCC’s auction for the 24 GHz frequency. And this is only the beginning.
Following the underwhelming auction of the 28 GHz (dubbed Auction 101) spectrum, which only returned $703 million, the new auction of the 24 GHz (dubbed Auction 102) is heating up quickly. The auction started last Thursday and has gone through 11 rounds of the first phase of the auction, or the “clock phase”, when participants bid on a Partial Economic Area (PEA) blocks. By the end of round 11, the gross proceeds have reached a total amount of $563,427,235. There are still two days, or six more rounds to go, before the winners can move to the next phase of the process.
The “assignment phase” will allow the winners from the first phase to bid for specific frequency licence assignments. The total bid value for the 24 GHz frequencies could go up to between $2.4 billion and $5.6 billion, according to the estimate by Brian Goemmer, founder of the spectrum-tracking company AllNet Insights & Analytics, when he spoke to our sister publication Light Reading.
The key difference the has driven up the interest from the bidders for Auction 102 is the locations where the frequencies are made available. While major metropolises like New York, Los Angeles, or Chicago, were absent from 28 GHz auction, they are all on the current 24 GHz auction together with other major cities that would be the candidates for the 5G services to roll out in the first wave.
Bidders have included AT&T, Verizon, T-Mobile, Sprint and more than 30 other companies. The FCC will announce the winners including those from Auction 101 only after both phases of Auction 102 are completed.
In addition to bidding for mmWave frequencies, operators like AT&T are also actively refarming the lower frequency bands in their possession that are used to provide 3G services. AT&T sent a notice to its customers in February that it will stop 3G only SIM activation, urging customers to move to LTE. The company said “we currently plan to end service on our 3G wireless networks in February 2022.” Specifically the company is planning to refarm the 850 MHz and 1900 MHz frequency bands, saying “it may be necessary for us to turn down one band of our owned and operated 3G network, such as 1900 MHz or 850 MHz service”.
Considering the AT&T only switched its 2G networks off at the beginning of 2017, this is a clear sign that the generational transition of mobile telecom services is accelerating. Earlier in the middle of last year, Verizon confirmed that it will shut down its 3G CDMA networks by the end of 2019. Even earlier at the MWC in 2017, T-Mobile’s CTO Neville Ray said the company was looking to sunset both GSM and WCDMA.